Economic globalisation is the union of the world’s economies and its various commercial and financial markets. “Economic globalisation refers to the increasing interdependence of world economies as a result of the growing scale of cross-border trade of commodities and services, flow of international capital and wide and rapid spread of technologies.” (Shangquan, 2000) Globalization has undoubtedly expanded international economic activity such as the movement of international trade, capital, information and people. Although globalisation has delivered wealth and opportunity as well as creating millions of jobs in Asia, it does come with its disadvantages as well. This essay will investigate the concept of economic globalization and explore some of the benefits and drawbacks of economic globalization in Asia. Benefits, in terms of economic globalization, can include changes to the economy such as: “improvements of the gross domestic product (GDP), improvements of foreign direct investment, unemployment decreasing, trade balance, and so on” (Karen L O'Brien, 2000). Benefits can also refer “to improvements in social well-being, as represented by various indicators of health, education and access to services.” (Karen L O'Brien, 2000). A disadvantage of economic globalization may be outlined by “higher levels of unemployment, increased income inequality, and reductions in social services” (Karen L O'Brien, 2000) which come as results of globalization. Globalization has a very uneven effect throughout Asia. This unevenness leads to some regions of Asia (mainly coastal regions and countries) reaping the benefits of economic globalization as they are the areas who are increasingly incorporated into the global economy. Social groups and transnational corporations can also directly or indirectly benefit from this globalization. Areas which may not benefit or may even be disadvantaged by economic globalization include remote areas of Asia. In some cases the labour force can also be negatively impacted by economic globalization. These areas or groups of people do not reap the benefits, or are directly negatively impacted, as they are left out of globalization process (Karen L O'Brien, 2000). For example, globalization is worsening the patterns of uneven development within China. Investment flows and other trends associated with economic globalization tend to be focused on coastal ecosystems. This focus on coastal areas is due to the four special economic zones which are found on the coast. The special economic zones have much better transportation and communications infrastructure than inland, western, regions of China. This infrastructure allows companies to easily export their manufactured goods and due to this ability these coastal regions of Asia have received more foreign direct investment and generated larger exports. In contrast, the western region of the country, which is largely untouched by economic globalization, has not has not been successful in terms of exports and participation in international markets (Karen L O'Brien, 2000). Coastal regions are both benefited and disadvantaged by globalization; the degradation of the ecosystem in coastal Asia is one of the disadvantages. Increased economic activity impacts climate change as it creates pollution, reduces areas of wetlands and also results in deforestation. Coastal Asia is extremely vulnerable to climate change as there is possibility of regions flooding due to rising sea levels and erosion and increased run off due to storm surges. This climate change which is accelerated by economic globalization is estimated to affect approximately 70 million people living in the coastal regions of China. The rising sea levels and increased storm surges can also destroy low lying rice farms and fisheries which would affect the Chinese economy. As economic globalization continues to cause pollution and deforestation, it will continue to negatively impact coastal areas of Asia (Karen L O'Brien, 2000). Moreover, economic globalization has increased the influence of large agricultural enterprises and international financial flows on land use decisions (Eric F. Lambina, 2011).This can include decisions on the deforestation of natural forests. The agricultural industry brings a lot of money into the Asian economy. When large agricultural enterprises control these decisions, it makes it challenging for Asian countries to preserve its natural forest ecosystems while still enhancing its food production. As natural forests are cut down in order to keep supplying agricultural land for large enterprises, many wild native animals lose their habitat and are displaced. These animals can also eventually become endangered or extinct. In turn deforestation largely impacts the whole ecosystem as the animals will have to scatter and find new areas to make their homes, which will disrupt the natural food chain. If the natural food chain is disrupted, many pests will thrive and over run the ecosystems they live in. The deforestation will also make air quality worsen; poor air quality and smog already being a large problem in many Asian cities. As economic globalization continues and takes over land use in Asia, it could very possibly make areas of Asia unlivable for humans and many animals.
A beneficial side of economic globalization is that it has improved the economic liberty and competition of the Asian region as it has improved these aspects it has also raised the efficiency and living standards of people in these countries. For the less developed countries in Asia, globalization can bring foreign capital, global export markets, and advanced technology to the economy. Consequently, faster economic growth promotes a reduction of poverty, encourages democratization, and higher standards for labour and the environment. For example, the speed of the economic growth in the Japanese economy in the 1990s enabled both GDP per capita and employment to greatly develop. Within the first few decades of economic globalization Japan became a highly industrialized country. “Japan was riding high as an economic success” (Warner, 202). This economic success began due to the Japanese economy having a surplus of labour when there was a high international demand for labour with low costs. (Warner, 202). As Japan provided low cost labour, in turn, poverty was reduced, foreign capital was increased and Japan began to produce more advanced technology. As Japans economy grew due to economic globalisation manufacturing jobs moved from countries, such as Japan, which now have higher labour costs, to economies with lower wage costs such as China and Vietnam. As jobs migrate from country to country, or even to poorer regions within a country, the economies of these countries will strengthen. Although economic globalisation does have a good effect on Asian economies, it has a very uneven impact (Warner, 202). In contrast, there have also been disadvantages to the labour force as a result of economic globalization. As stated previously, economic globalization has had a great impact but it is also uneven. The system of employment improving the economy sometimes works in reverse. Unemployment is a negative effect of economic globalisation. In those economies which were very affected by the Asian financial crisis, unemployment rates were at a high level. The countries which were not affected as much has lower unemployment levels. China was a country that was especially affected, the unemployment rate was estimated to be over 10% (Warner, 202). Unemployment is also growing every day in the Peoples Republic of china and the Chinese Academy of Social Sciences recently proclaims that unemployment was “the biggest challenge currently facing the Chinese Economic System” (Meiyan Wang, 2006). The highest unemployment rate reported was 22.4% in the Liaoning Province, followed by Hunan at 21.3%. By the early 2000s, unemployment rates were even higher due to the pressures of globalization (Warner, 202). As a result of this unemployment and poverty, Asian people rely on large manufacturing companies who make objects such as electronics in Asia for work. “By design, cross-border production networks incorporate low-wage third world labor into an export-driven system” (Hart-Landsberg, 2015). The Asian region’s shares in total world exports of manufacturers has grown from 11.1% to 33.8% in just over ten years . China alone accounted for almost half of all of the third world total manufactures in 2009-2010. As well as accounting for almost half of all third world manufactures, china was responsible for 57% of total third world country network exports in 2009–2010 in terms of network trade in manufactures (Hart-Landsberg, 2015). An area which has become a strong centre for manufacturing mobile phones for the rest of the world is East Asian region. China and Korea alone have exported more than half of the worlds mobile phones (Joonkoo Lee, 2016) . Asia has come to occupy the leading spot in the new international division of labor. Working in the supply chain for electronics such as mobile phones is likely one of the only ways for the people to get some money and to provide for their families. These large corporations set up their production chains in Asia due to the effects of economic globalization. They require a large amount of cheap wage labour (which is in surplus in Asia) so they pay their employees extremely low wages. An example of one of these corporations is Foxxcon. Foxxcon is a manufacturing company based in Zhengzhao, China which makes products for electronics giants such as Apple. Foxxcon provides horrible working conditions for their employees. They violate labour rights by keeping employees in overcrowded dormitories which are guarded in a military like way; they keep employees working for excessive hours with no compensation for the overtime and the management of the company controls almost every aspect of the workers lives, violating their privacy (Foxconn: Working Conditions in Chinese Factories, n.d.). Due to these extremely bad working conditions, many of the employees become depressed. There has been multiple instances where employees have killed themselves onsite due to their depression caused by working in such awful conditions (Greene, 2012). To conclude, economic globalization is an inevitable process; it has its benefits and disadvantages to different parts of the Asian region. These benefits and disadvantages affect Asia in a unbalanced way. Economic globalization can improve the standard of living for the Asian population by providing employment, generating economic growth and creating opportunities. It has opened and liberated many Asian economies, however, economic globalization also comes with costs. Economic globalization should be controlled within a boundary outlined by international society in order to reduce and hopefully avoid its disadvantages such as accelerating the pace of climate change and the mistreatment of the Asian labour force. In regards to economic globalization, you cannot be overly optimistic nor overly pessimistic about the impacts it poses to the Asian region. Economic globalization has been uneven throughout Asia due to the variation of geography, population, economies, labour markets so therefore it is a much more complex matter than just deciding whether economic globalisation has had a positive or negative impact on the Asian region.